The author is a Forbes contributor. The opinions expressed are those of the writer.

Loading ...

Loading ...

This story appears in the {{article.article.magazine.pretty_date}} issue of {{article.article.magazine.pubName}}. Subscribe

The music industry has attempted to sell higher-quality versions of recorded music at higher prices for a long time. From half-speed-mastered, heavy-vinyl LPs in the 1970s to digital disc formats like DVD-Audio and Super Audio CD in the 2000s, these products have only appealed to the small audiophile market. Now a new generation of digital music services is coming along that attempt to compete with the likes of Spotify, Rhapsody, and Beats Music with high-fidelity streaming music on demand. Two such services, Tidal and Deezer Elite, launched recently in the U.S. market.

The recent history of recorded music technology has been one of enhancements in high-end sound quality vying with improvements in convenience and cost that maintain “good enough” sound quality. The latter innovations -- the Walkman, MP3 codec, iPod, portable Bluetooth speakers -- have invariably trumped pure sound quality improvements in the mass market. So, the question is whether any fundamental shifts in technology or consumers' listening habits will ever shift that dynamic and increase the market for high-quality sound beyond the audiophile niche.

Many technical factors go into the sound quality of digital music, but the most important are the sampling rate (how finely the sound was captured in the first place), codec (the algorithm used to encode the music in files or streams for consumers), and bit rate (the amount of data per second of encoded music). Codecs are generally classified as lossless, meaning no sound information is discarded in the encoding process, and lossy, meaning that the process discards sound information in order to save storage space.

The most commonly used schemes for digital music today are MP3 and various flavors of MPEG4 Advanced Audio Coding, or AAC for short. Apple uses AAC in iTunes downloads, while Amazon uses MP3. Most popular streaming services these days use variants of AAC. Spotify is an exception: it uses a codec called Ogg Vorbis, whose primary advantage is that (unlike AAC) it costs nothing to license. These are all lossy codecs. All else being equal, the latest versions of AAC are generally considered to offer the best sound quality.

Lossless codecs used for music include FLAC and Apple Lossless, a/k/a ALAC. Online retailers selling files in these formats, such as HDtracks and iTrax, have existed for years. Bandcamp, a major site that helps artists sell their music directly to the public, requires artists to upload their music in FLAC. It converts the files to multiple codecs and offers them all to consumers.

The major record companies have generally been happy to license their catalogs in high-quality formats, in the hopes that they can sell at higher price points. In general, record labels are always on the lookout for ways to repackage music in different product formats at different price points.

But that’s not really how the music industry has developed. Although small retailers like HDtracks sell albums in lossless formats at up to several times the prices of the same albums in standard quality on Amazon and iTunes, the larger retailers don't offer better quality at higher prices. Neither Apple nor Amazon sells lossless files. In 2007, Apple started iTunes Plus, which made some tracks available at double the bit rate (256kbps vs. 128kbps), and without DRM, at a higher price point. But two years later it abandoned iTunes Plus and instead made all of its music available that way at the standard prices. More recently, Apple started a program called Mastered for iTunes that helps audio engineers optimize their mastering processes for the best possible sound quality, but it doesn't charge consumers extra for music produced that way. Bandcamp charges one price (set by the artist) for any format the user wants, including lossless.